Knowledge Management Case Study Knowledge Management at Microsoft, 1997 * * Table of Contents Introduction* * Developing the Competency Structure Defining Competencies for Specific Jobs Rating Employees on Job Competencies Bu…
Knowledge Management Case Study
Knowledge Management at Microsoft, 1997
Table of Contents
Introduction
Developing the Competency Structure
Defining Competencies for Specific Jobs
Rating Employees on Job Competencies
Building an Online Competency System
Linkages to Educational Resources
Implementing the Competency Model
Introduction
Since its founding in 1975, one of the competitive advantages of Microsoft Corporation has been the quality of its people. The highly successful software firm goes to extraordinary lengths to hire people with strong intellects and capabilities. According to the authors of Microsoft Secrets, a book about the company, one of Microsoft's key strategies is, "Find smart people who know the technology and the business."
One of the reasons why Microsoft people need high levels of competence is the fast-changing nature of the industry in which it competes. Microsoft rose to its position of industry dominance in a period of a few years, and Bill Gates, the company's well-known CEO, is determined that the company will stay on top. For example, Gates and other Microsoft executives recently concluded that the company needed to embrace the Internet and incorporate it into virtually all products and services. As a result, software developers and marketers need to be able to acquire new skills quickly.
This unusual attention to human resource capabilities, however, is not restricted to product-oriented personnel. Microsoft's internal Information Technology (IT) group, for example, faces the same pressures to produce software and to adapt to rapid industry change. The IT group consists of over 1000 employees who develop applications, build infrastructure, and operate computers and networks. Unlike many firms, Microsoft's IT group does not tolerate "legacy people" whose skills have become obsolete. If Microsoft's product set includes, for example, OLE (object linking and embedding) technology, then the internal IT group must rapidly incorporate it into the company's internal systems. The knowledge base for Microsoft IT must always be current.
Therefore, the IT group has focused heavily on the issue of identifying and maintaining knowledge competencies. Neil Evans, the former head of the IT group, is now addressing the issue as a researcher on a National Science Foundation project at the Northwest Center for Emerging Technologies. Chris Gibbon, the current IT director, hired Susan Conway as a Program Manager to take on the issue of knowledge competencies. Conway had developed similar competency programs at Computer Sciences and Texaco before coming to Microsoft.
Conway's goal is to create an online competency profile for jobs and employees within Microsoft IS. A pilot in an 80-person application development group was completed in November 1995, and full implementation is proceeding. The project, called Skills Planning "und" Development (thus affectionately known as "SPUD"), is focused not on entry level competencies, but rather on those needed and acquired to stay on the leading edge of the workplace. However, shortcomings in the educational system must be addressed by competencies acquired on the job.
The SPUD initiative is being managed by the "Learning and Communication Resources" group within Microsoft IT, which also has responsibility for training and education for IT personnel. The goal is to use the competency model to transfer and build knowledge, not merely to test it. When Microsoft IT employees have a better idea of what competencies are required of them, they will be better consumers of educational offerings within and outside Microsoft. The project is also expected to lead to better matching of employees to jobs and work teams. Eventually the project may be extended throughout Microsoft and into other companies.
There were five major components to the SPUD project:
• Development of a structure of competency types and levels;
• Defining the competencies required for particular jobs;
• Rating the performance of individual employees in particular jobs based on the competencies;
• Implementing the knowledge competencies in an online system;
• Linkage of the competency model to learning offerings.
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Developing the Competency Structure
Before the project began Microsoft had already defined certain competencies, but they were largely restricted to entry-level skills. The Northwest Center was also studying entry-level skills for software developers, e.g., requirements definition for a new system. These base-level competencies became known as foundation knowledge in the four type model used in the SPUD project (Exhibit 1).
Exhibit 1
Types of Competencies
Above the foundation level there are local or unique competencies. These are advanced skills that apply to a particular job type. A network analyst, for example, might need a fault diagnosis competency for local area networks.
The next level of competencies are global and would be present in all employees within a particular function or organization. Every worker in the Controller organization, for example, would be competent in financial analysis; every IT employee would be competent in technology architectures and systems analysis.
The highest level in the competency structure is universal competencies; universal, that is, to all employees within a company. Such competencies might be a knowledge of the overall business a company is in, the products it sells, and the drivers of the industry. A course for all employees sought to provide general knowledge of the software industry and Microsoft's strategies.
Within each of the four foundation competencies there are two different types. Explicit competencies involved knowledge of and experience with specific tools or methods, e.g. Excel or SQL 6.0. Requirements definition competency, for example, is an implicit competence. Implicit competencies involve more abstract thinking and reasoning skills. At Microsoft, the implicit competencies are expected to remain quite stable over time, although one new one, Web authoring, was recently added. Explicit competencies, of course, change frequently with rapid changes in fortunes of particular languages and tools. Within all four competency types, there are 137 implicit competencies and 200 explicit ones.
Within each type of competency there are also four defined skill levels. A worker might have, or a job might require, any of the levels below: • basic • working • leadership • expert.
Each skill level for each competency is described in three or four bullet points that make the level clear and measurable. The goal of the skill descriptions is to avoid ambiguity in rating jobs and employees.
A sample competency description for data administration is shown in Exhibit 2.
Exhibit 2
Sample Competency Description
Defining Competencies for Particular Jobs
Since one of the purposes of the SPUD project was to match jobs and employee capabilities, each job in Microsoft IT had to be rated in terms of the competencies required to perform it. This task was typically performed by the manager to whom the job would report. There are 40 to 60 competencies in the average job template.
One early problem that emerged with the job ratings was that it took a manager between two and three hours to rate a job in terms of the competencies needed. In order to deal with this issue, managers were encouraged to rate only the highest priority competencies, i.e., those requiring the highest skill levels. The goal was to have the job rating process require only about a half hour.
The system also included a "measurement model" with suggestions for the supervisor about how a particular competency might be evaluated. Because the goal was knowledge transfer rather than testing, employees also had access to the measurement model.
Rating Employees on Job Competencies
Another key step in the project involved evaluating workers in terms of the competencies they have exhibited in their current jobs. The initial rating is built in an iterative fashion by the employee and his or her supervisor; eventually the entire work team will participate. After an initial rating by both parties they meet and resolve their differences. The rating process is intended to serve as an occasion for conversation about the employee's competencies; the supervisor may not be aware, for example, of experience with a competency area prior to the current job.
The overall goal of the employee rating process is to build a competency inventory that can be used all across Microsoft. A manager seeking to build a team for a new project can no longer know personally all of the employees who might be qualified for the job. Therefore, the supervisor could query the on-line system and ask, "Give me the top five candidates who have leadership skill levels on 80% of the competencies for this job and who are based in Redmond (Microsoft's headquarters location in Washington)."
In the pilot of the SPUD project, both supervisors and employees tended to require extremely high skill levels to give good ratings. Susan Conway expected that this problem would be solved when the detailed characterizations of skill levels were available, so that the specific experience of the job and the worker could be easily compared to the skill level.
Building an Online Competency System
The SPUD project involved building an online system that contained the competency structure, the job rating system and ratings database, and the competency levels for employees. Conway had built a prototype of the system for the pilot using Microsoft Access; though it had worked well, the system needed greater performance and robustness, and was being ported to SQL Server. The system would have a Web front end for easy access around the world through Microsoft's Intranet.
Though the technical implementation was fairly straightforward, there were issues to be resolved. One of these was the location of data. After discussion it had been determined that job data would be managed centrally; employee data needed to reside in the group/country of origin, but would replicated to a central database. Access and security issues were a concern because people data were involved; it was viewed as inappropriate even for managers to have access to all competency profiles for employees at levels below them. It would also be undesirable for managers composing teams to "raid" existing teams for members with desired competencies. The details of access had yet to be determined.
Linkages to Educational Resources
Because a key goal of the project involved linking competency profiles to educational resources, some linkages to specific course opportunities inside and outside Microsoft had already been developed, although substantial work remained. Ultimately, the Learning and Communications Resources group hoped to be able to recommend not only specific courses, but even specific material or segments within a course that would be aimed at the targeted competency level. Conway hoped to use the system to assess course demand on the basis of role descriptions and the competencies they required. Ultimately, everything from internal brown bag seminars to external courses offered in the Puget Sound area would be rated as to the competencies and skill levels for which they were appropriate.
Implementing the Competency Model
The pilot for the SPUD project had gone well, and now implementation was proceeding with all 1000 people and their jobs in the Microsoft IT group. Implementation was proceeding across geography and function, starting with the Operations function, then the Applications function, and all jobs in Europe.
One issue to be determined was how the competency model might spread to product-oriented software developers within Microsoft. Many of the same competencies were obviously relevant in the product domain. As one way to accomplish this migration, Conway was working on how the competency model might be integrated into Framework, Microsoft's methodology for product development. Since Framework was also marketed externally, embedding the competency model within it might also create a demand for the competency model in other software companies.
Another unresolved issue was the relationship between the competency model and Employee and Management Development, part of Microsoft's overall human resources function. This group had supplied some of the competency descriptions used in the model, specifically some implicit ones (e.g., "team spirit," "intellectual horsepower") that were desired throughout Microsoft. Conway envisioned that the group would arbitrate disputes between supervisors and employees on competency ratings, and they would obviously help to define competencies and education linkages outside of the IT domain. But their specific role relative to the competency model had not yet been negotiated.
Some aspects of the role of the competency model within Microsoft could only be determined over time. Susan Conway hoped, for example, that the model would become a vehicle for institutionalizing innovation in this fast-changing industry. If Bill Gates, for example, determined that employees at Microsoft needed to master a new form of knowledge (e.g., Web-based application development), then he could force development of the competency by insisting upon its presence in all job competency requirements. A means by which needed innovations could be identified and rapidly implemented would seem to be critical in Microsoft's business and industry.
Conway also realized that the success of the project depended upon the behaviors of the individuals who would use it. "This won't go anywhere unless people feel they are getting something from it, " she commented. She felt that it is critical for employees and supervisors to feel that they contributed to the development of templates for jobs. Then they will buy into the competency model because they had a hand in the design and implementation of it, she hopes. Ultimately, this ambitious attempt to advance knowledge by focusing on individual knowledge competencies requires the active involvement by everyone in the organization.
Knowledge Management at Microsoft, 1997
Table of Contents
Introduction
Developing the Competency Structure
Defining Competencies for Specific Jobs
Rating Employees on Job Competencies
Building an Online Competency System
Linkages to Educational Resources
Implementing the Competency Model
Introduction
Since its founding in 1975, one of the competitive advantages of Microsoft Corporation has been the quality of its people. The highly successful software firm goes to extraordinary lengths to hire people with strong intellects and capabilities. According to the authors of Microsoft Secrets, a book about the company, one of Microsoft's key strategies is, "Find smart people who know the technology and the business."
One of the reasons why Microsoft people need high levels of competence is the fast-changing nature of the industry in which it competes. Microsoft rose to its position of industry dominance in a period of a few years, and Bill Gates, the company's well-known CEO, is determined that the company will stay on top. For example, Gates and other Microsoft executives recently concluded that the company needed to embrace the Internet and incorporate it into virtually all products and services. As a result, software developers and marketers need to be able to acquire new skills quickly.
This unusual attention to human resource capabilities, however, is not restricted to product-oriented personnel. Microsoft's internal Information Technology (IT) group, for example, faces the same pressures to produce software and to adapt to rapid industry change. The IT group consists of over 1000 employees who develop applications, build infrastructure, and operate computers and networks. Unlike many firms, Microsoft's IT group does not tolerate "legacy people" whose skills have become obsolete. If Microsoft's product set includes, for example, OLE (object linking and embedding) technology, then the internal IT group must rapidly incorporate it into the company's internal systems. The knowledge base for Microsoft IT must always be current.
Therefore, the IT group has focused heavily on the issue of identifying and maintaining knowledge competencies. Neil Evans, the former head of the IT group, is now addressing the issue as a researcher on a National Science Foundation project at the Northwest Center for Emerging Technologies. Chris Gibbon, the current IT director, hired Susan Conway as a Program Manager to take on the issue of knowledge competencies. Conway had developed similar competency programs at Computer Sciences and Texaco before coming to Microsoft.
Conway's goal is to create an online competency profile for jobs and employees within Microsoft IS. A pilot in an 80-person application development group was completed in November 1995, and full implementation is proceeding. The project, called Skills Planning "und" Development (thus affectionately known as "SPUD"), is focused not on entry level competencies, but rather on those needed and acquired to stay on the leading edge of the workplace. However, shortcomings in the educational system must be addressed by competencies acquired on the job.
The SPUD initiative is being managed by the "Learning and Communication Resources" group within Microsoft IT, which also has responsibility for training and education for IT personnel. The goal is to use the competency model to transfer and build knowledge, not merely to test it. When Microsoft IT employees have a better idea of what competencies are required of them, they will be better consumers of educational offerings within and outside Microsoft. The project is also expected to lead to better matching of employees to jobs and work teams. Eventually the project may be extended throughout Microsoft and into other companies.
There were five major components to the SPUD project:
• Development of a structure of competency types and levels;
• Defining the competencies required for particular jobs;
• Rating the performance of individual employees in particular jobs based on the competencies;
• Implementing the knowledge competencies in an online system;
• Linkage of the competency model to learning offerings.
Click here to return to Table of Contents
Developing the Competency Structure
Before the project began Microsoft had already defined certain competencies, but they were largely restricted to entry-level skills. The Northwest Center was also studying entry-level skills for software developers, e.g., requirements definition for a new system. These base-level competencies became known as foundation knowledge in the four type model used in the SPUD project (Exhibit 1).
Exhibit 1
Types of Competencies
Above the foundation level there are local or unique competencies. These are advanced skills that apply to a particular job type. A network analyst, for example, might need a fault diagnosis competency for local area networks.
The next level of competencies are global and would be present in all employees within a particular function or organization. Every worker in the Controller organization, for example, would be competent in financial analysis; every IT employee would be competent in technology architectures and systems analysis.
The highest level in the competency structure is universal competencies; universal, that is, to all employees within a company. Such competencies might be a knowledge of the overall business a company is in, the products it sells, and the drivers of the industry. A course for all employees sought to provide general knowledge of the software industry and Microsoft's strategies.
Within each of the four foundation competencies there are two different types. Explicit competencies involved knowledge of and experience with specific tools or methods, e.g. Excel or SQL 6.0. Requirements definition competency, for example, is an implicit competence. Implicit competencies involve more abstract thinking and reasoning skills. At Microsoft, the implicit competencies are expected to remain quite stable over time, although one new one, Web authoring, was recently added. Explicit competencies, of course, change frequently with rapid changes in fortunes of particular languages and tools. Within all four competency types, there are 137 implicit competencies and 200 explicit ones.
Within each type of competency there are also four defined skill levels. A worker might have, or a job might require, any of the levels below: • basic • working • leadership • expert.
Each skill level for each competency is described in three or four bullet points that make the level clear and measurable. The goal of the skill descriptions is to avoid ambiguity in rating jobs and employees.
A sample competency description for data administration is shown in Exhibit 2.
Exhibit 2
Sample Competency Description
Defining Competencies for Particular Jobs
Since one of the purposes of the SPUD project was to match jobs and employee capabilities, each job in Microsoft IT had to be rated in terms of the competencies required to perform it. This task was typically performed by the manager to whom the job would report. There are 40 to 60 competencies in the average job template.
One early problem that emerged with the job ratings was that it took a manager between two and three hours to rate a job in terms of the competencies needed. In order to deal with this issue, managers were encouraged to rate only the highest priority competencies, i.e., those requiring the highest skill levels. The goal was to have the job rating process require only about a half hour.
The system also included a "measurement model" with suggestions for the supervisor about how a particular competency might be evaluated. Because the goal was knowledge transfer rather than testing, employees also had access to the measurement model.
Rating Employees on Job Competencies
Another key step in the project involved evaluating workers in terms of the competencies they have exhibited in their current jobs. The initial rating is built in an iterative fashion by the employee and his or her supervisor; eventually the entire work team will participate. After an initial rating by both parties they meet and resolve their differences. The rating process is intended to serve as an occasion for conversation about the employee's competencies; the supervisor may not be aware, for example, of experience with a competency area prior to the current job.
The overall goal of the employee rating process is to build a competency inventory that can be used all across Microsoft. A manager seeking to build a team for a new project can no longer know personally all of the employees who might be qualified for the job. Therefore, the supervisor could query the on-line system and ask, "Give me the top five candidates who have leadership skill levels on 80% of the competencies for this job and who are based in Redmond (Microsoft's headquarters location in Washington)."
In the pilot of the SPUD project, both supervisors and employees tended to require extremely high skill levels to give good ratings. Susan Conway expected that this problem would be solved when the detailed characterizations of skill levels were available, so that the specific experience of the job and the worker could be easily compared to the skill level.
Building an Online Competency System
The SPUD project involved building an online system that contained the competency structure, the job rating system and ratings database, and the competency levels for employees. Conway had built a prototype of the system for the pilot using Microsoft Access; though it had worked well, the system needed greater performance and robustness, and was being ported to SQL Server. The system would have a Web front end for easy access around the world through Microsoft's Intranet.
Though the technical implementation was fairly straightforward, there were issues to be resolved. One of these was the location of data. After discussion it had been determined that job data would be managed centrally; employee data needed to reside in the group/country of origin, but would replicated to a central database. Access and security issues were a concern because people data were involved; it was viewed as inappropriate even for managers to have access to all competency profiles for employees at levels below them. It would also be undesirable for managers composing teams to "raid" existing teams for members with desired competencies. The details of access had yet to be determined.
Linkages to Educational Resources
Because a key goal of the project involved linking competency profiles to educational resources, some linkages to specific course opportunities inside and outside Microsoft had already been developed, although substantial work remained. Ultimately, the Learning and Communications Resources group hoped to be able to recommend not only specific courses, but even specific material or segments within a course that would be aimed at the targeted competency level. Conway hoped to use the system to assess course demand on the basis of role descriptions and the competencies they required. Ultimately, everything from internal brown bag seminars to external courses offered in the Puget Sound area would be rated as to the competencies and skill levels for which they were appropriate.
Implementing the Competency Model
The pilot for the SPUD project had gone well, and now implementation was proceeding with all 1000 people and their jobs in the Microsoft IT group. Implementation was proceeding across geography and function, starting with the Operations function, then the Applications function, and all jobs in Europe.
One issue to be determined was how the competency model might spread to product-oriented software developers within Microsoft. Many of the same competencies were obviously relevant in the product domain. As one way to accomplish this migration, Conway was working on how the competency model might be integrated into Framework, Microsoft's methodology for product development. Since Framework was also marketed externally, embedding the competency model within it might also create a demand for the competency model in other software companies.
Another unresolved issue was the relationship between the competency model and Employee and Management Development, part of Microsoft's overall human resources function. This group had supplied some of the competency descriptions used in the model, specifically some implicit ones (e.g., "team spirit," "intellectual horsepower") that were desired throughout Microsoft. Conway envisioned that the group would arbitrate disputes between supervisors and employees on competency ratings, and they would obviously help to define competencies and education linkages outside of the IT domain. But their specific role relative to the competency model had not yet been negotiated.
Some aspects of the role of the competency model within Microsoft could only be determined over time. Susan Conway hoped, for example, that the model would become a vehicle for institutionalizing innovation in this fast-changing industry. If Bill Gates, for example, determined that employees at Microsoft needed to master a new form of knowledge (e.g., Web-based application development), then he could force development of the competency by insisting upon its presence in all job competency requirements. A means by which needed innovations could be identified and rapidly implemented would seem to be critical in Microsoft's business and industry.
Conway also realized that the success of the project depended upon the behaviors of the individuals who would use it. "This won't go anywhere unless people feel they are getting something from it, " she commented. She felt that it is critical for employees and supervisors to feel that they contributed to the development of templates for jobs. Then they will buy into the competency model because they had a hand in the design and implementation of it, she hopes. Ultimately, this ambitious attempt to advance knowledge by focusing on individual knowledge competencies requires the active involvement by everyone in the organization.